Action Man, Care Bears and Star Wars figures were toys almost every British child in the 1970s and 80s couldn't wait to get their hands on. So why did Palitoy, the company that made them, fall into decline?

They were once the must-have playthings coveted by children across the UK.

Christmases and birthdays were rarely complete without the presence of an Action Man, a Care Bear, a Tiny Tears doll or a Star Wars figurine.

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Care Bears were another popular Palitoy brand

All of these toys were made at Palitoy - a company based in the industrial town of Coalville, in Leicestershire.

Yet at the height of its selling powers, the firm was being wound down and closed. What led to its demise?

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Media captionAction Man was one of Palitoy's most famous creations

The company, originally named Cascelloid, was founded in 1919 by a man named Alfred Pallett.

The toy division, which produced toy windmills and baby rattles, became part of a larger plastics factory.

By the 1950s and 60s, Cascelloid's toy section was performing strongly and it created a separate toy division named Palitoy - a nod to the company's founder.

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Palitoy began to produce Star Wars figures in the 1970s

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Action Man was originally the British answer to the US toy G I Joe

In the 1960s, 70s and 80s brands such as Spirograph, Airfix and Tiny Tears were really taking off.

Alongside them was one of Palitoy's most enduringly popular toys - Action Man.

Launched in 1966, Action Man was originally based on the American toy G I Joe.

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In the 1960s, many of Palitoy's toys found enormous popularity

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The brand was bought by US giant General Mills in 1968

But the design was inherently British, with Action Man driving Land Rovers and Scorpion Tanks and wearing anything from a Grenadier Guards uniform to a Manchester United strip.

And the character's most famous feature, his gripping hand, also had its origins close to home.

Former chief toy designer Bob Brechin said he modelled the body part on his own.

"We turned him into a British toy," he said.

"We came up with the idea of giving him hair on his head, rather than just painted hair, and gave him his distinctive gripping hand."

All of this home-grown success brought Palitoy to the attention of the international market and in 1968 it was sold to the US giant General Mills, which already owned other toy producers.

By the late 70s, the success of Action Man meant expansion for the business, with sales topping 20 million.

Palitoy was producing many of its figures on licence, meaning it manufactured other companies' ideas and paid for the privilege.